Health Datapalooza

Thank you, Tom. Thank you to all our partners in the Health Data Consortium who helped make today possible. And I want to give special thanks to all the innovators here today.

The fact that we are here today is a tribute to your imagination, talent, and persistence. Two years ago, the Health Data Initiative began with 45 people in a conference room brainstorming a vision for how data could be used to improve care and health.

And though it was our department that brought that group together, we knew we had a limited role to play in making that vision a reality. We could be a convener and a catalyst. But there was only one force powerful enough to drive the kind of transformation we were talking about: American entrepreneurs.

Less than two and a half years later, the results speak for themselves. We’ve gone from 45 people in a room to an overflow crowd of more than 1600. We’ve gone from 21 applications submitted at the first Health Data Initiative to nearly 250 submitted leading up to today. And most importantly, we’ve begun to see these innovations make a difference in the lives of millions of Americans across the country.

We made a bet two years ago that if we broke down barriers to innovation and unleashed American ingenuity, we could begin to transform health care forever. And we were right.

But as exciting as the last few years have been, we’re just getting started. When I compare the health care system today to the health care system of my childhood, there have been some amazing changes – remarkable new medicines and vaccines, incredible technologies like MRIs and CT scans, miraculous new procedures like heart transplants.

But there are others parts of our health care system that, decades later, look frozen in time. Take the example of a mom who’s been referred to a cardiologist for an irregular heartbeat.

Forty years ago, she had no easy way to find a good specialist except asking her doctor or friends. When she got to her appointment, she had to fill out all her health information from scratch, hoping she didn’t miss a crucial detail. Her doctor would make a diagnosis, despite having little access to past test results or notes from other doctors involved in her care. And then she would be sent home with a treatment plan, but no easy ability to check on her progress or ask questions until her next appointment.

Today, that exact same scene plays out thousands of times every day. The only difference is the dates on the magazines in the waiting rooms.

What we have is an innovation gap in health care. While we’ve made great progress over the years in developing more advanced medicines and treatments, we’ve made little progress in other areas – from how patients track and manage their own health, to how they choose a doctor, to how doctors work together to develop a treatment plan.

And where there’s no innovation, there’s no improvement. The result is massive inefficiencies in our health care system that harm our health, waste doctors’ time, and drive up costs for families, businesses, and government.

This innovation gap is the underlying problem that contributes to all our other health care challenges. That’s why this Administration has made closing this gap one of our top priorities.

Now, as I said earlier, we knew that government couldn’t do this alone. But we also knew we had a key role to play in removing the obstacles holding innovation back. And that’s exactly what we’ve tried to do, starting with changing the incentives in our health care system.

For too long, we paid for health care in a way that not only failed to reward innovation, but could even punish it. For example, if a hospital improved their follow-up care so that they had fewer readmissions, they often actually make less money.

That meant there was little incentive for innovation, since if your idea for improving care was too good, it could put your hospital out of business.

We needed to change the way we paid for care to begin rewarding improvement. And because Medicare and Medicaid cover almost one in three Americans, it had to start with them.

Later today, some of you will attend the panel on Accountable Care Organizations or ACOs. Even a year ago, this would have been a very hypothetical conversation. Today, we have 59 health organizations signed up to be ACOs with another 150 applications for a July start date. And this is just one of dozens of new opportunities in the law.

What this means is that a sustainable business case for health care innovation is finally emerging. If you have an idea for how to keep people healthier, cut waste, or improve care, there is going to be demand for that idea. And that demand is only going to grow.

The second step we took to support innovation was to help set in motion a national transition to electronic health records.

We know that electronic health records are a key platform for health innovation. They put up-to-date health information in the hands of doctors and patients with potentially huge health benefits.

For example, one recent study of more than 27,000 adults with diabetes found that those with electronic health records were 600 percent more likely to get the right care. 600 percent!

But because electronic health records also come with significant challenges like high upfront costs and compatibility issues, just a fifth of primary care doctors and a sixth of hospitals across the country were using electronic health records when we came into office in 2009.

So over the last three years, we’ve used funds from the Recovery Act to start removing those obstacles. We’re helping to establish common standards for sharing information and giving hospitals and doctors incentive payments to help offset the startup expenses. The result is that just three years later, twice as many hospitals and primary care doctors are using electronic health records.

When you add the fact that smart phones now account for more than half of all phone sales in the US, we’re seeing an unprecedented expansion of platforms that can support new health innovations.

If new incentives are the engine for innovation and new technologies like electronic health records are the vehicle, then data is the fuel. That was the bet we made two years ago when we launched the Health Data Initiative. Our theory was that if we took the vast stores of data our department already had, stripped out all the personal information, and made it available to developers, you would use it to create incredible tools.

And that’s exactly what you’ve done. The dozens of new applications being presented this week include tools for helping policy-makers strengthen public health programs, helping doctors and nurses deliver better care, helping consumers better manage their health, and bringing more transparency to health care to foster competition and improvement.

Part of what makes this year’s event so exciting is that so many of these tools were created by companies that only formed in the last year or two. But it’s also exciting to see innovations that were presented in past years continue to grow.

iTriage is a perfect example. Created by an ER doctor from Colorado, it’s a one-stop app that helps people figure out what’s wrong, what they need to get better, and where to go to get it. Since being introduced two years ago, it’s added new features, grown into a company of 65 employees, and been acquired by Aetna where it’s now a key part of how they’re getting consumers involved in their own care.

That’s just one of many success stories that have been written over the last couple of years. And as you heard yesterday, we’re committed to giving entrepreneurs even more fuel by making more data available, while maintaining absolute protections on patient privacy.

Simply put, the conditions for health care innovation have never been better than they are today. We have growing demand for new tools that can improve care and reduce costs. We have a growing number of platforms that can support those tools. And we have a growing amount of available data that can power those tools.

We have the engine, the vehicle, and the fuel – now, we just need the drivers. That’s you.

Now, I know I don’t have to convince you of the size of the opportunity in front of us. When you take the biggest technology breakthrough of our time and apply it to one of the most persistent social problems of our time, it’s not hard to see the potential for growth. There’s a reason venture capital investment in health IT is up 60 percent since 2009, even in challenging times.

But while I do believe you’re helping create a new high-tech sector that will be a powerful source of jobs in the future, the biggest beneficiaries of your work won’t show up in analyst reports or on earnings statements.

They’ll be the retirees who live to see their grandkids graduate college because they can better manage their chronic conditions. They’ll be the doctors who get to spend more time with their patients and less time with their paperwork.

And it will be that woman with the irregular heartbeat who, ten years from now, may have a very different experience than she would have had today.

Instead of searching blindly for a specialist, she’ll be able to use her phone to easily compare local doctors and schedule an appointment. When she shows up, the office will already have her complete medical information so she won’t have to worry about some key detail falling through the cracks. She’ll leave with better tools for monitoring her progress and getting answers in between appointments. And her doctors will be able to easily communicate with each another to coordinate her care.

It’s a health care future with better care, less waste, stronger connections with your doctor, and more control. And the only way we can get there is by closing the health innovation gap.

I believe there’s only one group of people in the world who can do that. Fortunately, they’re here in this room.

So thank you for everything you’ve done over the last year. And I can’t wait to see what you come up with in 2013.